Friday, May 24, 2024

    OPINION EU takes a step towards the West’s first AI law – what comes next, ethics or investment?

    Claire Trachet highlights the impact the EU’s potential new law could have on investment in the sector

    The European Union (EU) is a step closer to approving the Western world’s first-of-a-kind generative AI law – titled the AI Act – which will manage the use of tools like ChatGPT. As Europe aims to regulate AI systems that have the potential to cause harm to society, this opens the discussion as to whether the UK will follow suit.

    The new bill outlines three categories: ‘unacceptable risk’, which poses severe threats to rights and freedom, ‘high risk’, which creates a great risk to safety and health, alongside fundamental rights, and freedom, and finally, ‘low risks’, systems that pose no risks.

    The new act will also cover technology with facial recognition in public places, as well as social scoring and biometric categorisation. These programs have been criticised by the public for privacy violations and having the potential to be intrusive and discriminatory.

    The new act has brought about concerns in the tech sector that the broad nature of the law could cause issues for AI that are harmless, posing a risk to innovation. Additionally, this raises concerns about how the act will impact the UK. The UK’s pro-innovation framework which was cited as ‘light’ regulation, appeared to be prioritising the vast amount of investment the sector is receiving, contributing roughly £3.7bn in value to the UK economy, as well as attracting almost £19bn in private investment through 2022. This suggests that there is potential for the UK to continue to prioritise the growing investment the sector appears to be receiving.

    The AI sector is incredibly fast-paced, which makes it incredibly difficult to establish effective regulation quickly. However, as anxiety increases surrounding the risks AI may pose, the EU has clearly felt compelled to act and is on the verge of introducing the most significant regulation we’ve seen to date.

    There needs to be a balance between stimulating innovation and mitigating privacy concerns, which means making sure an equal amount of investment goes into both. We know that AI brings in a wealth of investment, so it’s important that the investment goes into safeguarding and regulations as well as a drive for innovation. The EU act has the potential to affect investment into the sector because of its ability to place restrictions on AI that may not actually pose risks.

    The UK appears to be taking a more balanced approach compared to the EU, but with a focus on ultimately driving growth in the sector. This suggests that the UK will become an even bigger hub for AI investment, as its AI whitepaper focused more on supporting innovation. If this law is introduced, it may result in the UK being seen as a more popular destination for AI investment than mainland Europe.


    Claire Trachet is CEO of Trachet

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